Law Humor

The Madoff Morning Huddle Hosted by Harbeck

From: Steve Harbeck
To: Senator John McCain
cc: Irv Picard

Dear Senator:
Just to go on the record; your comment today re: the federal government's health care bill and reference to Bernard Madoff is creating a headache for us, as many are suggesting that our approach to managing the financial challenges with regard to insurance payments is no different than the way the current administration is attempting to deal with a completely un-related topic.

OK, maybe its not unrelated--as many of those that we're holding back claim payments to are octogenerians that can no longer afford quality health care.

But, the innuendo that you made is only making our claims processing that much more difficult.

Yes, its true, in our morning huddles (a group meeting strategy that we picked up from Goldman Sachs), we've made it a policy to delay payments for as long as possible, or at least until we effect some claw backs to mitigate any chance the money would have to come from our coffers.

Yes, its true that there are hundreds of people that had more than one account at BMIS, and that we haven't paid a dime out on their claims. The morning huddle strategy remains in effect: every time one of those claimants calls, we tell them to call back again in two weeks. So far, its been working like a charm!

What's the issue?

Very simple: If an investor deposited $1 million in account "A", from which the investor never withdrew any funds, and also deposited $500k in account "B", but later transferred from Account "B" to Account "A" $500k or more, we've determined that that not only is the investor not entitled to SIPC protection in Account B, but the $500k transfer would be considered a withdrawal, and we'd consider that subject to a clawback, which would mean the $500k the investor might have been entitled to from Account A, would therefore be subject to our clawing back.

To the best of my understanding, the same logic is being endorsed by the Republican contingent on the topic of health care, and as such, I believe we'll ultimately be proven heroes.

Happy Holidays
From Steve and Irv

To: Catherine Hooper
From: Steve Harbeck

Thank you for the gift; with all of the crap raining down on me, I could always use another black umbrella. I would be interested to know more about your new firm's "document safe-keeping" strategy, and if you're offering discounted prices on those "emergency kits" with the hand sanitizer, please send us additional information.

S. Harbeck
President, SIPC

Finally:
From: Ruth Alpern
To: Whatever your name is. I would like to purchase the original poster. I will be happy to pay cash.

Full post as published by Bernard Madoff on December 21, 2009 (boomark / email).